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Updated.Robinhood is one of the new wave of brokerage apps. They started with free stocks trades, but have since expanded their suite of services to the following:

Free stock and ETF trades. No minimum balance requirement.

Free options trading. No commission and no per contract fee, plus no exercise or assignment fees.

WeBull (free stock bonus). WeBull app is also good for active traders with free stock trades and free options trades, but adds a real customer service phone number where you can talk to a human, as opposed to Robinhood’s email address.

SoFi Invest ($75 bonus). SoFi also offers free stock trades and “slices” (fractional shares), along with a sign-up bonus and free tickets to events (SoFi is short for Social Finance).

Firstrade. Firstrade includes free trades of mutual funds, which is rare… if that is your thing.

Background. I’ve been Robinhood beta user since mid-2014. I was skeptical as I’ve been an long-time early adopter of free trading platforms (read: cheapskate investor). In August 2015, they rolled out both iOS and Android app and reported processing over 2 million free trades. In 2017, they reached over a million users. In 2017, Bloomberg reported them raising money at a $1.3 billion valuation. In 2020, CNBC reported them raising money at an $8 billion valuation!

Application process. You must provide your personal information including Social Security number, net worth, income, investing experience, etc. This is the same as any other brokerage firm, but this may also be the first such account for many users. Everything was done online; there were no paper documents that required mailing or faxing.

Core features review.

Legit. Robinhood Financial is a member of the SIPC which protects the securities in your account up to $500,000. Data is encrypted with SSL. Apex is their clearing firm.

$0 commission trades. Yes, it works, all with no minimum balance requirement.

Market orders, limit orders, stop limit orders, and stop orders available. Certain orders may be entered as good for the day or good till canceled (GTC).

No short-selling.

Free options trading: No commission and no per contract fee upon buying or selling options, as well as no exercise or assignment fees. Level 2 self-directed options strategies (buying calls and puts, selling covered calls and puts) as well as Level 3 self-directed options strategies such as fixed-risk spreads (credit spreads, iron condors), and other advanced trading strategies are available.

Customer service limitations. The Robinhood customer service phone number is (650) 940-2700 during during market hours (9:30am – 4:00pm EST), however many readers have reported difficulty getting through. (Update: I no longer see any mention of this phone number on their website.) They want you to use their customer service email “support@robinhood.com”. The lack of instant customer service via phone is one major way that Robinhood is not the same as a major brokerage account like Fidelity or Schwab.

Funds transfers. You can manually link any bank account with your routing number and account number, but you can also directly use your username and password at these banks: Chase, Bank of America, Citibank, Wells Fargo, U.S. Bank, Charles Schwab, PNC, Silicon Vally Bank, and USAA. ACH transfers are free and take approximately 3 business days (same as other brokerages). There is also a automatic deposits feature where you can schedule ACH transfers on a weekly, biweekly, monthly, or quarterly basis.

Robinhood Instant. Robinhood Instant is a free upgrade that gets you a “limited margin account” that has the following features:

Immediate access to funds from selling stock. That means you can reinvest those funds without waiting two days for settlement. (All brokerage margin accounts offer this.)

Limited instant deposits. Use up to $1,000 of your pending bank deposits right away. No waiting 2-3 days for a bank transfer to complete.

What’s the catch? Getting free trades is great, but be aware of the following:

Although they announced that a web interface is available, I have been on the waitlist since early November (currently #600,000 in line). Full rollout is not scheduled until some time in 2018. Everyone can access their account via a mobile Apple iOS or Android device (iPhone, iPad, iPod Touch, Android phone, Android tablet).

There are unofficial sites that use the Robinhood API to provide web access, but I would be wary of sharing your login credentials with a 3rd-party.

I’m currently on a wait list for the free options trading as well.

Broker-assisted phone trades are $10 each, according to their fee schedule.

Electronic statements are the default and only free option. I don’t even see an option to enable paper statements in the app, but according to their fee schedule paper statements cost $5 a pop.

How do they make money? First, Robinhood will make some money the same way other brokers do: collect interest on your idle cash, charge you interest for margin loans, and sell order flow. The most innovative prospect is to the plan to sell API access to other financial apps.

The fact that Robinhood sells order flow may leave you with a slightly worse execution price as compared to other brokers with more complex order routing. If you are making large value trades, then this small percentage difference may add up to something significant that matters more than commission price. With my tiny order volume, I am fine with them selling my order flow if they are giving me commission-free trades.

Robinhood Gold is their premium service tier that gives you extending trading hours and interest-free margin for $10 a Month. My Robinhood Gold review.

User interface. Over the last 10 years, I’ve opened an account at the majority of the “discount” brokerage firms. I’ve had $0 trades before, along with $2 trades, $2.50 trades, $4.95 trades and so on. What makes Robinhood special is their modern, app-centric approach. I agree with this quote from Wired:

But the app’s simplicity is meant to be about more than style. Ease of access and understanding is meant to make Robinhood compulsively engaging for a new generation of investors that don’t find the stock market very accessible from the mobile screens at the center of their lives.

Screenshots.

Recap. Robinhood delivers on their $0 stock trades promise with no minimum balance. The app interface is clean and intuitive. Customer service can be slow to respond as they direct you to contact them only via email.

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Comments

I like the idea for newer, casual investors who want to just put some money to work in the market. A lot of newer investors find it hard to make money paying $7~ commissions both ways ($14~ total) to make an investment in just one stock. If you start with $1,000 and diversify to just a handful of companies you could easily be down 10% just from paying commissions.

I got approved as well. But until they add options, I will stick with Interactive Brokers. Hopefully, I will make the transition in 2015. Does anyone know about their margin account? I was never asked during the account setup process. Also, what is the margin they give you? In Interactive Brokers I get 1:4. For instance, if you have $100,000 in your account, your buying power is $400,000.

Checking FINRA shows an address and phone # that Robinhood Financial LLC used to file, but probly not their customer service. Dont forget the company also makes money on buy/sell order flow or bid/ask spread, reimbursements or incentives from exchanges for providing them trading volumes, possibly etf firms, and from the fees on their schedule,.
Does this company have any Windows PC’s? (It looks like they have Apple computers only; maybe that’s why launch began with Apple iPhone,iPads,ipad touch.) Hey Jonathan, can you email them for their margin rates and post’em, since youre an account holder?

So, looks like we have to wait a little longer until we can really use this brokerage. ACAT is also a must. That’s the only way I would transfer my 3 existing accounts from Interactive Brokers. Does anyone know if they are planning to support Roth IRA type of accounts?

There is no Roth IRA in Robinhood. My Roth IRA is in Fidelity. they offer free comission ETF. I open account in Robinhood and iIsave a lot in commissions. I bought stocks 3 to 8 a day and sold it on the next day even if I gain a dollar. No commission is such a huge savings to me.

Same deal for me. Got to sign-up only to find that it’s iPhone only. Seems odd that they would restrict their user-base so much and not even offer a PC option, but I suppose I can try again when they have an Android and/or PC option

For those still waiting, you can try one of these links below. I signed up this morning, and got 3 referral codes that let people jump the line and sign-up right away with no waiting. Each link will only work once.

I’ve never bought stocks, so bear with me. With this, would I be able to buy x number of shares of say, Google, stock, then decide to sell it sometime down the line, and have no fees throughout the process?

Say I buy one share at $511. Then it goes up to $600 and I sell it. Do I get “handed” (transferred into my bank account, sent a check, etc) $600 at that point?

Brent, first you transfer money into the account from your bank account. Then you can buy & sell stock with $0 commission / fees. And yes, when you are done, you can just transfer the current balance out of your Robinhood account back to your bank account.

When I registered my account there was no way to pick the account type, like margin, IRA, Roth IRA, etc. So, I guess at this point this is a regular individual cash brokerage account. Margin account types will appear next as they are eager to make money on margin loans. Then probably IRA. ACAT is not available yet, but it is coming some time next year. Like I said, I am looking to transfer all 3 of my accounts from Interactive Brokers where I pay $1 per trade. I wish Robinhood was around when I first started my investment business almost 11 years ago. I have spent around $50,000 on commissions. I remember I paid $10 per trade with my first broker TD Ameritrade. Sounds crazy now.

I have been using Robinhood for about a week now and its been a great experience, I loved it, however all of a sudden today everything went wrong. I noticed that there was money missing from my account. I looked at my total transfer history and the amount of stocks i own, I bought one share of a single company earlier in the week, proving that some of my money had disappeared. I have emailed Robinhood and they have not yet responded to me. Also before I found out about the money missing i had been trying to acquire more stock. Every time i made an attempt to buy it would give me an error that my account can only close positions. This doesn’t make any sense, I have more than enough money to buy the stock I attempted to buy with excess funds left over. I don’t know nor understand what Robinhood is doing. There was no notice or reason why any of this happened I just didn’t know what to do.

I’m getting really angry with every passing day they don’t respond to me about the issue. I’m gonna hit a point where i just can’t wait anymore and I’m going to just call the SEC cause they aren’t even talking to me about it I’m completely in the dark. It’s as if they don’t care, like the whole thing is a scam. I don’t want to think robinhood is a scam but the longer I go without my money returning the more the idea crosses my mind. I think they should hold back giving out new invitations and making new accounts to take care of important issues the current accounts are having they clearly cannot handle everything.

This is really scary. I was hoping to transfer all my accounts to Robinhood in 2015. Your problem with not being able to “buy” is pretty simple I think. You are only allowed 3 day trades in a 5 day period. If you make a fourth day trade, you get flagged and you can only do transactions to close your positions. Hence, you cannot buy anything new. I would love to hear from Jonathan and see what his experience has been over the last few weeks. You experience with missing money sounds horrible. But on the other hand there are a lot of happy customers from the posts I see on Facebook.

I got an invite, signed up and my account has been “Pending” ever since. Their FAQ says that normally only takes 24 hours, but it’s been about a week now. After a few days of waiting, I opened a ticket using their ticketing system, but here I am about 4 days later with no reply other than ones that look automated. They appear to be having growing pains. I hope they can get everything straightened out soon.

One thing that concerns is that I’ve had nearly $10k in my account and none of it is in stock currently. It is sitting as cash yet I am unable to withdraw it for the past week. Somewhat sketch. No customer service either. AVOID AVOID AVOID.

I use BofA and get 30 commission free trades a month (all my combined accounts, trading, checking, etc, qualifies me). Their brokerage is through Merrill Lynch who they merged with. From everything I’m reading about Robinhood, there’s a limit on # of trades/week (3?) and lack of customer service contact, which makes this a really iffy proposition. I might feel differently if I was paying for my transactions. I’m not confident in Robinhood being able to carry out my transactions as quickly as a larger brokerage like MLynch and reading a few comments about missing or inaccessible funds with lack of customer support, which makes me hesitant on accepting the invite I got. I can see the value in Robinhood though. It really is useful for the newbie investor, with limited funds, whose just stepping into the big shark infested stock market pool.

DYu, you are correct. There are a lot of limitations with Robinhood as of right now, such as:
No margin accounts
No options
No ACAT
No IRA accounts
They are working on implementing those things. Once they are available, Robinhood will be the only brokerage you need.
The 3 trades per week problem you mentioned will be resolved once margin accounts are allowed. That’s why I put it at the top of my list.

While a little paranoia is a very good thing when it involves your banking accounts, this is simply a way to instantly validate that it’s actually your account. You don’t have to fund it that way, though if you don’t mind waiting a few days. You can add a bank account via the routing and account numbers and they’ll make two small deposits within a few days. Then, validate that account by telling them the amounts they deposited, and that account will be eligible for transfers. If you are paranoid (like I was), log into your bank account right after the verification process and change your password.

Giving your login info for a bank account is standard procedure now. They only need it once to verify you actually own the account. Change the password before you give them your credentials. After they verify the account, change it back to original password…

Giving a LOGIN is NOT standard procedure now and saying so is incredibly misleading. Giving a routing number and bank account number is standard procedure. The moment I saw that they asked for this without giving an option of just providing bank account and routing number is when I backed away. My bank account log on password is tied to many different accounts and changing it complicates a lot of my other financial accounts. And my bank (Wells Fargo) does not let you change it and then go back to the one you had before. You can’t do that. So no – it is not a good thing to ask for this info nor would I ever consider giving it to any online app. I’m stunned people don’t realize this.

It’s becoming more and more common. I believe I’ve seen this a couple times in the last year or so with other bank accounts I’ve opened. Don’t recall which ones though. When you say your login is “tied to many different accounts”, I’m not sure if you mean that you use the same password for multiple accounts, but if that’s the case, you should really use a password manager app, like 1Password and have a unique password for every financial login.

Android Fail?… Are you kidding me? This is a GREAT app, and the fact it runs on Apple is a large part of the reason.

Android is a NIGHTMARE for developers because of its fragmented nature: there are hundreds of different hardware variants and trying to get your app working with anything but a small subset of these cripples small developers.

Also Android is riddled with malware. I wouldn’t trust the contents of a piggy- bank to an Android device, let alone my Stock portfolio.

And finally, Android is Google’s mechanism for tracking your every move. We all know why.

Apple’s not interested in your data and deliberately designs its systems not to collect data about you. I value their approach.

If I buy stock through Robinhood today, and they go out of business, what happens to my stock and my ability to sell it? (sorry if this is a stupid question. I’ve never dealt with stocks/investing/trading before.)

Robinhood is regulated heavily like any other brokerage like E*Trade or TD Ameritrade. If any brokerage goes out of business, the assets are usually simply sold and/or transferred to another registered firm. Client assets are always kept separate from the assets of the brokerage itself. Apex is the clearing firm for Robinhood, as well as several other discount brokerages.

SInce I am not an US citizen, I cannot use the app (I presume), but I love the idea of getting more and more investing opportunities for those interested. The more options there are, the more chances for people like us to be able to make money via investing.

My major complaint about Robinhood is how long it takes for funds to clear/settle funds after making a trade, which is generally 3 days.

Most brokers take just as long, but the key difference is that Robinhood does not allow you to trade/access any of those funds until the trade has fully settled. That’s an eternity compared to instant funds availability with regular brokers, like TD. I honestly would trade more often/use Robinhood more often if I didn’t have to wait 3 days to settle. I have found Robinhood to be good for small, purely speculative trades, but would make many more if the above was addressed.

“This is a simple fix for the poor info that Robinhood gives.
Download an app called Stock Tracker and upgrade to the Pro Version.
This allows you to view your portfolio, make real-time watch lists, screen stocks and heavy movers, and actually ties in with Robinhood to make trades through the app itself. You get real time prices and pretty nice graphs and tech indicators and basic fundamentals (vol, pe, Etc.)”

The service looks pretty solid, though, as far as I know, most people have trouble making money via the active trading that no commissions might encourage. Though it could be great for someone that wants to buy and hold a lot of stocks in small amounts (kind of like building your own ETF).

I can understand the argument that no commissions might encourage active trading. While I am an advocate of low-cost ETFs, I would hope that if you had say $500 and started trading stocks, it would provide a real world education that it’s not as easy as it might seem. My initial education was somewhere in 2000-2001 via an E-Trade account with $20 trades if I recall.

How’s their tax integration with something like TurboTax? I hate having to go back and look up trades I did a specific year. I’m using CapitalOne now, but would be willing to try Robinhood if they can pull out trade info into TurboTax.

“In TurboTax, when prompted to “Choose your bank or brokerage,” enter “Robinhood” in the search field. TurboTax will ask for your account number, which can be found in the Tax Documents section of the Robinhood app. Please add “10-” before the first 8 digits of your account number (10-5XX12345). Do not include hyphens in your SSN.”

You may experience difficulty uploading your Robinhood financial transaction history into TurboTax if you made close to 500 transactions in 2016. TurboTax Online can handle up to 500 transactions per brokerage account. However, online performance may deteriorate as you get close to this limit.”

I think I’m going to give this a shot in the next few months. I’ll report back anything good/bad. Initially I’ll be working with small amounts of money and the cost per trade at other places likely makes that impractical or quite expensive. I have my IRA at Vanguard where I stick to ETFs and their mutual funds.

Although reading more deeply, Robinhood only supports FIFO when selling stock, so you can’t optimize your tax liability. It also doesn’t support automatic dividend reinvestment. So it might not be my best option for long haul investing. It looks potentially interesting to play around with for fun, though.

I love Robinhood and I am in alot of stock groups on social media. Looks like a lot of people are talking of switching to Webull simply because their after hours trading is a lot longer. People are saying they are losing a lot of money since the market is moving way before Robinhood is open.

Sh*ty app worst experience you will ever have with trading stocks, and you WILL lose money they are a small company that cannot handle all the food on their plate. Leave it to professionals. DO NOT USE ROBINHOOD. YOU WILL LOSE MONEY Messing with these AMATEURS!

I’d like to open an account with you guys and I’m wondering if I can do stock transfers from my existing Schwab and Fidelity accounts to my RobinHood account? I appreciate if you can get back to me asap. Thank you!

Do you get money to advertise their system ??
Their service is awful, they locked my account for no reason while I have more than $50K in trading and no one responds to my emails.
This is a trading system and every second does matter. But they don’t care about their customers.

Please do not bother with this app, Their customer support is WORTHLESS! If you have a problem like I did and need to seek help, you are on ur own and have to do what is necessary. My account got locked and I sold my stocks and now they wont let me transfer the funds back into my account so now I am out $779! You can email them but only get computer generated cookie cutter emails and NO real live support. I may have to seek lawyer to get my money which will cost me more then my lost money! BEWARE!! BEWARE!!!

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